Consortium may buy another after acquiring 2 banks

[LRE]

Consortium may buy another after acquiring 2 banks

* Unconfirmed reports say Hussain Lawai-led consortium is eyeing KASB-Atlas

By Mushfiq Ahmad

KARACHI: The consortium that has recently acquired stake in Arif Habib Bank and is currently holding talks to buy Mybank is also interested in getting a stake in soon-to-be-merged KASB and Atlas Bank, sources told Daily Times.

Sources said that the consortium wants to have a very strong bank with a paid-up capital of Rs 22 billion. To achieve this aim, they are looking to buy a stake in the merged bank even after acquiring two small banks.

Officials of Atlas Bank and KASB were not immediately available for comment.

The Hussain Lawai-led consortium has already signed a MoU with the Arif Habib Securities Limited to invest Rs 4.5 billion to acquire up to 50 percent shares of the Arif Habib Bank Limited.

The consortium is currently holding negotiations for acquiring majority shareholding of Mybank by way of purchasing total shareholding from the existing sponsor shareholders.

According to a letter sent to country's stock exchanges by Mybank, a memorandum of understanding has been signed by Iqbal Alimohamed (one of the sponsor shareholders of Mybank) with Hussain Lawai (who is leading the consortium) as a preclude to the formalisation of the material terms and fulfillment of all other regulatory requirements.

KASB and Atlas Group announced last month they had agreed to merge their respective banks. As a result, KASB Bank, KASB Capital and Atlas Bank would merge together to form KASB Atlas Bank. The merged entities would have a capital base in excess of Rs 12.5 billion and a branch network exceeding 110 branches.

Samba Bank buying Citibank Pakistan?: Only two years ago it was a struggling bank. Now it is so strong thanks to the Saudi money that it is going to buy an American bank's Pakistan operations.

Unconfirmed reports say the Crescent Commercial Bank (now Samba Bank Limited) is going to take over Citibank Pakistan. An official at the former said it was not their bank's policy to comment on such speculation while the spokesman for the latter said they would release a statement in a day or two to make things clear.

There have been reports that the foreign banks operating in Pakistan may leave the country because of losses suffered by their parent institutions although they themselves are profitable. Citibank Pakistan has, sometimes back, stopped issuing housing loans. Its employees have been anxious because the management didn't try to retain those leaving for joining Barclays. "It looks they are no more interested in continuing Pakistan's operations," said an employee.

Samba Bank Limited is a majority owned subsidiary of Samba Financial Group of Saudi Arabia. Samba Financial Group currently holds a 68.4 percent stake in Samba Bank Limited. Samba bought 600 million shares of CresBank with a total value of Rs 6 billion ($100 million) in May last year. The Crescent Bank acquisition had come after its liabilities had exceeded its assets. It was reported at the time that bank's assets were used to "illegally benefit" the CEO of the bank and his brother.

http://www.dailytimes.com.pk/default.asp...2008_pg5_1